OREANDA-NEWS. Allegiance Bancshares, Inc. (NASDAQ:ABTX), the holding company of Allegiance Bank (collectively, “Allegiance”), reported net income attributable to common stockholders of $5.3 million in the second quarter 2016, a 45.0% increase over the second quarter 2015 and a 17.3% decrease compared to the first quarter 2016. Net income per diluted common share increased 11.1% to $0.40 in the second quarter 2016 compared to net income per diluted common share of $0.36 for the second quarter 2015 and decreased 18.4% compared to $0.49 for the first quarter 2016. Excluding the after tax gain of $1.3 million on the sale of the two Central Texas branch locations during the first quarter 2016, net income attributable to common stockholders would have been $5.0 million and net income per diluted common share would have been $0.39 for the first quarter 2016.

“Allegiance Bank delivered another strong quarter,” said George Martinez, Allegiance’s Chairman and Chief Executive Officer.  “We benefited from continued growth in our loan portfolio during the quarter, and our asset quality remains very high.  We achieved solid gains across the board when compared to last year’s second quarter.” 

“Allegiance Bank’s credit quality and our outlook remain strong. Our second quarter performance reflects our emphasis on core loans and demonstrates the growth potential of the Bank.  Most importantly, it underscores our ability to prudently grow our loan portfolio and high-quality asset base and increase returns to our shareholders.  The Bank’s growing pool of talented bankers intends to maintain this momentum by remaining focused on our super-community banking strategy across Houston,” continued Martinez.

Second Quarter 2016 Results

Second quarter 2016 annualized returns on average assets, average common equity and average tangible common equity were 0.91%, 7.79% and 9.30%, respectively, compared to annualized returns on average assets, average common equity and average tangible common equity of 0.84%, 8.20% and 10.04%, respectively, for the second quarter 2015.  Annualized returns on average assets, average common equity and average tangible common equity for the first quarter 2016 were 1.19%, 9.70% and 11.67%, respectively.  Excluding the gain on the sale of the two Central Texas branch locations, the annualized returns on average assets, average common equity and average tangible common equity for the first quarter 2016 would have been 0.94%, 7.67% and 9.22%, respectively.

Allegiance’s efficiency ratio in the second quarter 2016 decreased to 60.11% from 64.90% in the second quarter 2015 and from 63.80% in the first quarter 2016. 

Net interest income before provision for loan losses in the second quarter 2016 increased $2.2 million, or 11.2%, to $21.9 million from $19.7 million for the second quarter 2015, as a result of a 25.3% increase in average interest-earning assets primarily due to organic loan growth and the increase in the securities portfolio. Net interest income before provision for loan losses in the second quarter 2016 increased $865 thousand, or 4.1%, from $21.1 million in the first quarter 2016. The net interest margin on a tax equivalent basis decreased 47 basis points to 4.32% for the second quarter 2016 from 4.79% for the second quarter 2015, and decreased 13 basis points from 4.45% for the first quarter 2016. Excluding the impact of acquisition accounting adjustments, the net interest margin in the second quarter 2016 would have been 4.24%, compared to 4.49% and 4.35% in the second quarter 2015 and first quarter 2016, respectively.

Noninterest income in the second quarter 2016 was $1.2 million, an increase of $265 thousand, or 28.0%, compared to $947 thousand in the second quarter 2015 and a decrease of $2.1 million, or 63.3%, compared to $3.3 million in the first quarter 2016. The first quarter 2016 included the gain on the sale of two Central Texas branch locations.

Noninterest expense in the second quarter 2016 increased $501 thousand, or 3.7%, to $13.9 million from $13.4 million in the second quarter 2015, and decreased $330 thousand, or 2.3%, from $14.3 million in the first quarter 2016.

Six Months Ended June 30, 2016 Results

For the six months ended June 30, 2016 annualized returns on average assets, average common equity and average tangible common equity were 1.04%, 8.74% and 10.46%, respectively, compared to annualized returns on average assets, average common equity and average tangible common equity of 0.80%, 7.47% and 9.83%, respectively, for the six months ended June 30, 2015.  Excluding the gain on the sale of the two Central Texas branch locations, the annualized returns on average assets, average common equity and average tangible common equity for the six months ended June 30, 2016 would have been 0.92%, 7.73% and 9.26%, respectively.

Allegiance’s efficiency ratio for the six months ended June 30, 2016 decreased to 61.93% from 66.99% for the six months ended June 30, 2015. 

Net interest income before provision for loan losses for the six months ended June 30, 2016 increased $4.5 million, or 11.8%, to $43.0 million from $38.5 million for the six months ended June 30, 2015, as a result of a 22.7% increase in average interest-earning assets primarily due to organic growth within the loan portfolio and the increase in the securities portfolio. The net interest margin on a tax equivalent basis decreased 38 basis points to 4.38% for the six months ended June 30, 2016 from 4.76% for the six months ended June 30, 2015.  Excluding the impact of acquisition accounting adjustments, the net interest margin for the six months ended June 30, 2016 would have been 4.29%, compared to 4.43% for the six months ended June 30, 2015.

Noninterest income for the six months ended June 30, 2016 was $4.5 million, an increase of $2.7 million, or 149.1%, when compared to $1.8 million for the six months ended June 30, 2015. The first quarter 2016 included the gain on the sale of two Central Texas branch locations.  Noninterest expense for the six months ended June 30, 2016 increased $1.2 million, or 4.3%, to $28.2 million from $27.0 million for the six months ended June 30, 2015.

Financial Condition

Total loans at June 30, 2016 increased $192.0 million, or 12.3%, to $1.75 billion compared to $1.56 billion at June 30, 2015 and increased $36.2 million, or 2.1%, compared to $1.72 billion at March 31, 2016. These increases were due to strong organic loan growth within Allegiance Bank’s loan portfolio. Second quarter 2016 core loans, excluding the mortgage warehouse portfolio and loans held for sale, increased $223.4 million, or 15.4%, to $1.68 billion from $1.45 billion in the second quarter 2015 and increased $46.8 million, or 2.9%, from $1.63 billion in the first quarter 2016.

Deposits at June 30, 2016 increased $218.0 million, or 13.4%, to $1.84 billion compared to $1.63 billion at June 30, 2015 and increased slightly compared to deposits at March 31, 2016.

Asset Quality

Nonperforming assets totaled $8.6 million, or 0.37% of total assets, at June 30, 2016, compared to $6.2 million, or 0.32% of total assets, at June 30, 2015, and $8.5 million, or 0.38% of total assets, at March 31, 2016. The allowance for loan losses was 0.85% of total loans at June 30, 2016, 0.66% of total loans at June 30, 2015, and 0.80% of total loans at March 31, 2016.

The provision for loan losses in the second quarter 2016 was $1.6 million, or 0.38% (annualized) of average loans, compared to $1.4 million, or 0.39% (annualized) of average loans, in the second quarter 2015, and $710 thousand, or 0.17% (annualized) of average loans, in the first quarter 2016.  The provision for loan losses for the six months ended June 30, 2016 was $2.4 million, or 0.28% (annualized) of average loans, compared to $2.1 million, or 0.29% (annualized) of average loans for the six months ended June 30, 2015.

Second quarter 2016 net charge-offs were $485 thousand, or 0.11% (annualized) of average loans, compared to $48 thousand, or 0.01% (annualized) of average loans, in the second quarter 2015, and $51 thousand, or 0.01% (annualized) of average loans, in the first quarter 2016.  Net charge-offs for the six months ended June 30, 2016 were $536 thousand, or 0.06% (annualized) of average loans, compared to $37 thousand, or 0.01% (annualized) of average loans for the six months ended June 30, 2015.

GAAP Reconciliation of Non-GAAP Financial Measures

Allegiance’s management uses certain non-GAAP financial measures to evaluate its performance. Specifically, Allegiance reviews tangible book value per common share, return on average tangible common equity and the ratio of tangible common equity to tangible assets. Please refer to the GAAP Reconciliation and Management’s Explanation of non-GAAP Financial Measures on page 11 of this Earnings Release for a reconciliation of these non-GAAP financial measures.

 

Allegiance Bancshares, Inc.

Allegiance Bancshares, Inc. is a $2.37 billion asset Houston, Texas-based bank holding company. Through its wholly owned subsidiary, Allegiance Bank, Allegiance provides a diversified range of commercial banking services primarily to Houston metropolitan area-based small to medium-sized businesses and individual customers. Allegiance’s unique super-community banking strategy was designed to foster strong customer relationships while benefitting from a platform and scale that is competitive with larger local and regional banks.  Allegiance Bank operates 16 full-service banking locations in the Houston metropolitan area. 

“Safe Harbor” Statement under the Private Securities Litigation Reform Act of 1995

This release may contain forward-looking statements within the meaning of the securities laws that are based on various facts and derived utilizing important assumptions, present expectations, estimates and projections about Allegiance and its subsidiaries. Statements preceded by, followed by or  that otherwise include the words “believes,” “expects,” “anticipates,” “intends,” “projects,” “estimates,” “plans” and similar expressions or future or conditional verbs such as “will,” “should,” “would,” “may” and “could” are generally forward-looking in nature and not historical facts, although not all forward-looking statements include the foregoing words. Forward-looking statements include information concerning Allegiance’s future financial performance, business and growth strategy, projected plans and objectives, as well as projections of macroeconomic and industry trends, which are inherently unreliable due to the multiple factors that impact economic trends, and any such variations may be material. Such forward-looking statements are not guarantees of future performance and are subject to risks and uncertainties, many of which are outside of Allegiance’s control, which may cause actual results to differ materially from those expressed or implied by the forward-looking statements. These risks and uncertainties include but are not limited to whether Allegiance can: continue to develop and maintain new and existing customer and community relationships; successfully implement its growth strategy, including identifying suitable acquisition targets and integrating the businesses of acquired companies and banks; continue to sustain its current internal growth rate; provide quality and competitive products and services that appeal to its customers; continue to have access to debt and equity capital markets; and achieve its performance objectives. These and various other risk factors are discussed in Allegiance’s Annual Report on Form 10-K for the fiscal year ended December 31, 2015 and in other reports and statements Allegiance has filed with the Securities and Exchange Commission. Copies of such filings are available for download free of charge from the Investor Relations section of Allegiance’s website at www.allegiancebank.com, under Financial Information, SEC Filings.  Any forward-looking statement made by Allegiance in this release speaks only as of the date on which it is made. Factors or events that could cause Allegiance’s actual results to differ may emerge from time to time, and it is not possible for Allegiance to predict all of them. Allegiance undertakes no obligation to publicly update any forward-looking statement, whether as a result of new information, future developments or otherwise, except as may be required by law.

Allegiance Bancshares, Inc.  
Financial Highlights  
(Unaudited)  
                     
    2016       2015    
   June 30     March 31     December 31     September 30     June 30   
                     
   (Dollars in thousands)   
                     
Cash and cash equivalents $   210,863     $   183,290     $   148,431     $   144,590     $   138,685    
Available for sale securities     303,463         215,401         165,097         154,546         151,662    
                     
Total Loans (including loans held for sale)     1,753,683         1,717,448         1,681,052         1,616,416         1,561,657    
Allowance for loan losses     (14,917 )       (13,757 )       (13,098 )       (11,204 )       (10,312 )  
Loans, net     1,738,766         1,703,691         1,667,954         1,605,212         1,551,345    
                     
Goodwill     39,389         39,389         39,389         39,389         39,389    
Core deposit intangibles, net     4,446         4,641         5,230         5,437         5,645    
Premises and equipment, net     17,821         18,121         18,471         18,838         18,887    
Other real estate owned     1,397         1,397         -          -          -     
Bank owned life insurance     21,530         21,377         21,211         21,040         20,872    
Other assets     29,906         23,400         18,796         23,298         18,671    
Total assets $   2,367,581     $   2,210,707     $   2,084,579     $   2,012,350     $   1,945,156    
                     
Noninterest-bearing deposits $   630,689     $   684,245     $   620,320     $   560,773     $   556,502    
Interest-bearing deposits     1,212,650         1,158,409         1,138,813         1,095,775         1,068,822    
Total deposits     1,843,339         1,842,654         1,759,133         1,656,548         1,625,324    
                     
Short-term borrowings     30,000         85,000         50,000         115,000         75,000    
Other borrowed funds     200,569         569         569         28,069         28,069    
Subordinated debentures     9,142         9,115         9,089         9,062         9,032    
Other liabilities     8,280         7,076         7,298         7,628         5,901    
Total liabilities     2,091,330         1,944,414         1,826,089         1,816,307         1,743,326    
Preferred equity     -          -          -          -          11,550    
Common equity     276,251         266,293         258,490         196,043         190,280    
Stockholders' equity     276,251         266,293         258,490         196,043         201,830    
Total liabilities and equity $   2,367,581     $   2,210,707     $   2,084,579     $   2,012,350     $   1,945,156    
                     
Allegiance Bancshares, Inc.  
Financial Highlights  
(Unaudited)  
                             
                             
  Three Months Ended   Year-to-Date  
    2016       2015       2016       2015    
   June 30     March 31     December 31     September 30     June 30     June 30     June 30   
                             
  (Dollars in thousands)  
                             
INTEREST INCOME:                            
Loans, including fees $   22,839     $   22,228     $   22,431     $   21,627     $   21,079     $   45,067     $   41,385    
Securities     1,538         1,081         989         975         721         2,619         1,160    
Deposits in other financial institutions     150         142         72         43         50         292         124    
Total interest income     24,527         23,451         23,492         22,645         21,850         47,978         42,669    
                             
INTEREST EXPENSE:                            
Demand, money market and savings deposits     569         544         579         545         525         1,113         1,037    
Certificates and other time deposits     1,665         1,560         1,470         1,287         1,211         3,225         2,355    
Short-term borrowings     106         139         33         47         2         245         2    
Subordinated debt     120         117         139         114         162         237         325    
Other borrowed funds     118         7         16         245         216         125         446    
Total interest expense     2,578         2,367         2,237         2,238         2,116         4,945         4,165    
NET INTEREST INCOME     21,949         21,084         21,255         20,407         19,734         43,033         38,504    
Provision for loan losses     1,645         710         2,159         1,530         1,420         2,355         2,103    
Net interest income after provision for loan losses     20,304         20,374         19,096         18,877         18,314         40,678         36,401    
                             
NONINTEREST INCOME:                            
Nonsufficient funds fees     145         163         191         179         168         308         333    
Service charges on deposit accounts     173         145         166         163         176         318         351    
Gain on sale of branch assets     -          2,050         -          -          -          2,050         -     
Loss on sale of securities     -          -          (37 )       -          -          -          -     
Gain (loss) on sales of other real estate     -          -          -          1         -          -          (6 )  
Gain on sale of loans     -          -          -          235         -          -          -     
Bank owned life insurance     154         166         171         167         174         320         266    
Other      740         780         487         456         429         1,520         869    
Total noninterest income     1,212         3,304         978         1,201         947         4,516         1,813    
                             
NONINTEREST EXPENSE:                            
Salaries and employee benefits      9,177         9,273         8,905         8,996         8,481         18,450         17,423    
Net occupancy and equipment     1,214         1,232         1,179         1,289         1,274         2,446         2,358    
Depreciation      415         417         424         414         409         832         776    
Data processing and software amortization     622         653         750         841         827         1,275         1,453    
Professional fees     401         534         451         343         397         935         877    
Regulatory assessments and FDIC insurance      355         345         356         296         320         700         694    
Core deposit intangibles amortization      195         199         208         207         207         394         415    
Communications     274         280         298         300         358         554         692    
Advertising     197         201         271         188         184         398         322    
Other      1,073         1,119         1,054         1,027         965         2,192         1,998    
Total noninterest expense      13,923         14,253         13,896         13,901         13,422         28,176         27,008    
INCOME BEFORE INCOME TAXES      7,593         9,425         6,178         6,177         5,839         17,018         11,206    
Provision for income taxes     2,339         3,070         1,966         1,957         1,956         5,409         3,852    
NET INCOME      5,254         6,355         4,212         4,220         3,883         11,609         7,354    
Preferred stock dividends     -          -          -          173         260         -          386    
NET INCOME ATTRIBUTABLE TO COMMON                            
STOCKHOLDERS $   5,254     $   6,355     $   4,212     $   4,047     $   3,623     $   11,609     $   6,968    
                             
Allegiance Bancshares, Inc.  
Financial Highlights  
(Unaudited)  
                             
  Three Months Ended   Year-to-Date  
    2016       2015       2016       2015    
   June 30     March 31     December 31     September 30     June 30     June 30     June 30   
                             
  (Dollars and share amounts in thousands, except per share data)  
                             
Net income $   5,254     $   6,355     $   4,212     $   4,220     $   3,883     $   11,609     $   7,354    
                             
Net income attributable to common stockholders $   5,254     $   6,355     $   4,212     $   4,047     $   3,623     $   11,609     $   6,968    
                             
Earnings per common share, basic $   0.41     $   0.49     $   0.34     $   0.41     $   0.37     $   0.90     $   0.71    
Earnings per common share, diluted $   0.40     $   0.49     $   0.33     $   0.40     $   0.36     $   0.89     $   0.70    
                             
Return on average assets (A)    0.91 %     1.19 %     0.81 %     0.85 %     0.84 %     1.04 %     0.80 %  
Return on average common equity (A)    7.79 %     9.70 %     6.71 %     8.27 %     8.20 %     8.74 %     7.47 %  
Return on average tangible common equity (A) (B)   9.30 %     11.67 %     8.19 %     10.77 %     10.04 %     10.46 %     9.83 %  
Tax equivalent net interest margin (C)   4.32 %     4.45 %     4.60 %     4.61 %     4.79 %     4.38 %     4.76 %  
Efficiency ratio(D)   60.11 %     63.80 %     62.40 %     65.04 %     64.90 %     61.93 %     66.99 %  
                             
Liquidity and Capital Ratios                            
Equity to assets   11.67 %     12.05 %     12.40 %     9.74 %     10.38 %     11.67 %     10.38 %  
Common equity Tier 1 capital   11.69 %     11.57 %     11.71 %     8.61 %     8.68 %     11.69 %     8.68 %  
Tier 1 risk-based capital   12.16 %     12.04 %     12.20 %     9.12 %     9.88 %     12.16 %     9.88 %  
Total risk-based capital   12.92 %     12.76 %     12.92 %     9.75 %     10.48 %     12.92 %     10.48 %  
Tier 1 leverage capital   10.43 %     10.92 %     11.02 %     8.37 %     9.34 %     10.43 %     9.34 %  
Tangible common equity to tangible assets(B)   10.00 %     10.26 %     10.48 %     7.69 %     7.64 %     10.00 %     7.64 %  
                             
Other Data                            
Weighted average shares:                            
Basic     12,857         12,840         12,390         9,823         9,825         12,849         9,824    
Diluted     13,039         12,967         12,589         10,003         10,004         13,003         10,001    
Period end shares outstanding     12,869         12,845         12,813         9,823         9,823         12,869         9,823    
Book value per common share $   21.47     $   20.73     $   20.17     $   19.96     $   19.37     $   21.47     $   19.37    
Tangible book value per common share(B) $   18.06     $   17.30     $   16.69     $   15.39     $   14.79     $   18.06     $   14.79    
                             
                             
(A) Interim periods annualized.   
(B) Refer to the calculation of these non-GAAP financial measures and a reconciliation to their most directly comparable GAAP financial measures on page 11 of this Earnings Release.  
(C) Net interest margin represents net interest income divided by average interest-earning assets.          
(D) Represents noninterest expense divided by the sum of net interest income plus noninterest income, excluding net gains and losses on the sale of branch assets, loans and securities  
Additionally, taxes and provision for loan losses are not part of this calculation.           
                           
Allegiance Bancshares, Inc.  
Financial Highlights  
(Unaudited)  
                                     
  Three Months Ended  
  June 30, 2016   March 31, 2016   June 30, 2015  
  Average
Balance		   Interest
Earned/
Interest
Paid		   Average
Yield/
Rate		   Average
Balance		   Interest
Earned/
Interest
Paid		   Average
Yield/
Rate		   Average
Balance		   Interest
Earned/
Interest
Paid		   Average
Yield/
Rate		  
                                     
  (Dollars in thousands)  
Assets                                    
Interest-Earning Assets:                                     
Loans $   1,724,346     $   22,839       5.33 %   $   1,663,711     $   22,228       5.37 %   $   1,478,752     $   21,079       5.72 %  
Securities     270,619         1,538       2.29 %       186,460         1,081       2.33 %       127,882         721       2.26 %  
Deposits in other financial institutions     96,358         150       0.62 %       91,824         142       0.62 %       62,247         50       0.32 %  
Total interest-earning assets      2,091,323     $   24,527       4.72 %       1,941,995     $   23,451       4.86 %       1,668,881     $   21,850       5.25 %  
Allowance for loan losses      (14,129 )               (13,487 )               (9,265 )          
Noninterest-earning assets      236,857                 226,946                 195,341            
Total assets $   2,314,051             $   2,155,454             $   1,854,957            
                                     
Liabilities and Stockholders' Equity                                    
Interest-Bearing Liabilities:                                     
Interest-bearing demand deposits $   102,550     $   88       0.34 %   $   95,506     $   67       0.28 %   $   101,029     $   83       0.33 %  
Money market and savings deposits     435,851         481       0.44 %       433,139         477       0.44 %       420,992         442       0.42 %  
Certificates and other time deposits     627,982         1,665       1.07 %       614,216         1,560       1.02 %       548,076         1,211       0.89 %  
Short-term borrowings     88,242         106       0.48 %       126,374         139       0.44 %       4,451         2       0.16 %  
Subordinated debt     9,125         120       5.28 %       9,098         117       5.19 %       8,981         162       7.24 %  
Other borrowed funds     118,629         118       0.40 %       569         7       5.23 %       28,415         216       3.05 %  
Total interest-bearing liabilities      1,382,379     $   2,578       0.75 %       1,278,902     $   2,367       0.74 %       1,111,944     $   2,116       0.76 %  
                                     
Noninterest-Bearing liabilities:                                     
Noninterest-bearing demand deposits     652,405                 605,969                 534,688            
Other liabilities      8,139                 7,186                 6,868            
Total liabilities     2,042,923                 1,892,057                 1,653,500            
Stockholders' equity      271,128                 263,397                 201,457            
Total liabilities and stockholders' equity  $   2,314,051             $   2,155,454             $   1,854,957            
                                     
Net interest rate spread           3.97 %             4.12 %             4.49 %  
                                     
Net interest income and margin      $   21,949       4.22 %       $   21,084       4.37 %       $   19,734       4.74 %  
                                     
Net interest income and margin (tax equivalent)     $   22,481       4.32 %       $   21,483       4.45 %       $   19,923       4.79 %  
                                     
Allegiance Bancshares, Inc.    
Financial Highlights  
 (Unaudited)    
                           
  Year-to-Date      
  June 30, 2016   June 30, 2015      
  Average
Balance		   Interest
Earned/
Interest
Paid		   Average
Yield/
Rate		   Average
Balance		   Interest
Earned/
Interest
Paid		   Average
Yield/
Rate		      
                             
  (Dollars in thousands)      
Assets                            
Interest-Earning Assets:                             
Loans $   1,694,029     $   45,067       5.35 %   $   1,447,629     $   41,385       5.77 %      
Securities     228,540         2,619       2.30 %       110,355         1,160       2.12 %      
Deposits in other financial institutions     94,091         292       0.62 %       85,162         124       0.29 %      
Total interest-earning assets      2,016,660     $   47,978       4.78 %       1,643,146     $   42,669       5.24 %      
Allowance for loan losses      (13,808 )               (8,881 )              
Noninterest-earning assets      231,901                 210,533                
Total assets $   2,234,753             $   1,844,798                
                             
Liabilities and Stockholders' Equity                            
Interest-Bearing Liabilities:                             
Interest-bearing demand deposits $   99,028     $   155       0.31 %   $   103,744     $   179       0.35 %      
Money market and savings deposits     434,495         958       0.44 %       413,287         858       0.42 %      
Certificates and other time deposits     621,099         3,225       1.04 %       548,679         2,355       0.87 %      
Short-term borrowings     107,308         245       0.46 %       2,238         2       0.16 %      
Subordinated debt     9,111         237       5.23 %       8,940         325       7.33 %      
Other borrowed funds     59,599         125       0.42 %       28,243         446       3.18 %      
Total interest-bearing liabilities      1,330,640     $   4,945       0.75 %       1,105,131     $   4,165       0.76 %      
                             
Noninterest-Bearing liabilities:                             
Noninterest-bearing demand deposits     629,187                 533,098                
Other liabilities      7,663                 6,907                
Total liabilities     1,967,490                 1,645,136                
Stockholders' equity      267,263                 199,662                
Total liabilities and stockholders' equity  $   2,234,753             $   1,844,798                
                             
Net interest rate spread           4.03 %             4.48 %      
                             
Net interest income and margin      $   43,033       4.29 %       $   38,504       4.73 %      
                             
Net interest income and margin (tax equivalent)     $   43,964       4.38 %       $   38,762       4.76 %      
                             
Allegiance Bancshares, Inc.  
Financial Highlights  
(Unaudited)  
                     
  Three Months Ended  
    2016       2015    
   June 30     March 31     December 31     September 30     June 30   
                     
  (Dollars in thousands)  
Period-end Loan Portfolio:                    
Loans held for sale $   -      $   -      $   27,887     $   27,004     $   25,629    
                     
Commercial and industrial     382,795         372,056         383,044         367,341         346,703    
Mortgage warehouse     75,554         86,157         59,071         65,928         81,255    
Real Estate:                    
Commercial real estate (including multi-family residential)     806,771         770,252         745,595         710,857         678,979    
Commercial real estate construction and land development     161,572         167,810         154,646         151,369         140,437    
1-4 family residential (including home equity)     214,442         209,704         205,200         185,473         178,635    
Residential construction     101,677         100,611         93,848         95,212         94,167    
Consumer and other     10,872         10,858         11,761         13,232         15,852    
Total loans $   1,753,683     $   1,717,448     $   1,681,052     $   1,616,416     $   1,561,657    
                     
Asset Quality:                    
Nonaccrual loans $   7,124     $   6,979     $   5,184     $   6,185     $   5,722    
Accruing loans 90 or more                    
days past due     -          -          -          -          -     
Total nonperforming loans     7,124         6,979         5,184         6,185         5,722    
Other real estate     1,397         1,397         -         -         21    
Other repossessed assets     128         131         131         131         491    
Total nonperforming assets $   8,649     $   8,507     $   5,315     $   6,316     $   6,234    
                     
Net charge-offs (recoveries) $   485     $   51     $   265     $   638     $   48    
                     
Nonaccrual loans:                    
Loans held for sale $   -      $   -      $   209     $   498     $   1,130    
Commercial and industrial     2,723         2,700         2,664         3,477         3,186    
Mortgage warehouse     -          -          -          -          -     
Real Estate:                    
Commercial real estate (including multi-family residential)     4,141         3,293         2,006         1,783         974    
Commercial real estate construction and land development     -          -          -          -          -     
1-4 family residential (including home equity)     227         934         239         341         343    
Residential construction     -          -          -          -          -     
Consumer and other     33         52         66         86         89    
Total nonaccrual loans $   7,124     $   6,979     $   5,184     $   6,185     $   5,722    
                     
Asset Quality Ratios:                    
Nonperforming assets to total assets   0.37 %     0.38 %     0.25 %     0.31 %     0.32 %  
Nonperforming loans to total loans   0.41 %     0.41 %     0.31 %     0.38 %     0.37 %  
Allowance for loan losses to nonperforming loans   209.39 %     197.12 %     252.66 %     181.15 %     180.22 %  
Allowance for loan losses to total loans   0.85 %     0.80 %     0.78 %     0.69 %     0.66 %  
Net charge-offs to average loans (annualized)   0.11 %     0.01 %     0.06 %     0.16 %     0.01 %